Life Matters In Suicide

Along with the profound and painful questions that follow the loss of a loved one from suicide, there are practical and financial issues to address, too. If the loved one had life insurance, a common question is whether the policy will still cover the death. In general, there is coverage if your loved one:

• Had free life insurance through work, paid for by an employer
• Was insured under an individual policy that went into effect more than two years ago (one year in some states)
• Was insured under coverage that he or she purchased through work and that went into effect more than two years ago (one year in some states)

Even if the death is not covered, it’s important to follow up with the life insurance company.

If the claim is denied because of suicide, the beneficiary is typically owed a return of the premiums that the policyholder paid for the insurance.

This is generally seen by the industry and regulators as sufficient time to prevent policies from being purchased by someone who intends to commit suicide. If death from suicide occurs after this period, then the life insurance policy will pay out as it would for death from illness or other insured causes.

If the suicide occurs within the excluded period, the life insurance company won’t pay the death benefit. Generally in this case the insurer will return the premiums paid for the policy, minus any premiums that were owed before death. If it was a whole life or other permanent policy, any outstanding loans against the policy’s cash value would be subtracted as well. The returned premiums would go to the policy’s beneficiary.

How group life insurance treats suicide

Group life insurance at work — if the employer pays for it — typically does not contain a suicide clause. So if your loved one had free life insurance through work, then the coverage generally will pay a benefit. Contact the employer’s human resources department to learn how to file a claim.

However, group life insurance that employees purchase treats suicide much the way individual policies do, excluding it during the first one or two years. If the death occurred during the excluded period, the premiums the employee paid for the coverage would typically be returned to the beneficiary.

You are not alone if you’re dealing with the aftermath of suicide. Among American adults, 55% knew someone who took his or her own life, according to a 2017 poll by Rasmussen Reports, a public opinion polling company. The Centers for Disease Control and Prevention’s data pegs suicide as the 10th leading cause of death in the U.S.

If you’re picking up the pieces after losing someone from suicide, the important thing to remember about life insurance is not to let the cause of death keep you from filing a claim.